Choosing A Real Estate Agent | CFA 1 Choosing a Real Estate Agent: An Evaluation of Information Sources About Quality of Service 1 Stephen Brobeck Senior Fellow July 2020 1 This report is the fourth in a series on the lack of information available to home sellers and buyers about real estate agents. The earlier reports dealt with information related to representation and commissions – The Agency Mess: Home Buyers and Sellers are Confused and Harmed by Complex, Poorly Enforced State Laws on Real Estate Agent Disclosures (January 2019), Hidden Real Estate Commissions: Consumer Costs and Improved Transparency (October 2019), and Why Required Real Estate Disclosures About Representation Fail and How They Can Be Improved (January 2020)
Transcript
Choosing A Real Estate Agent | CFA 1
Choosing a Real Estate Agent: An Evaluation of Information Sources
About Quality of Service1
Stephen Brobeck Senior Fellow
July 2020
1 This report is the fourth in a series on the lack of information available to home sellers and buyers about real estate
agents. The earlier reports dealt with information related to representation and commissions – The Agency Mess:
Home Buyers and Sellers are Confused and Harmed by Complex, Poorly Enforced State Laws on Real Estate Agent
Disclosures (January 2019), Hidden Real Estate Commissions: Consumer Costs and Improved Transparency
(October 2019), and Why Required Real Estate Disclosures About Representation Fail and How They Can Be
Consumers depend heavily upon real estate agents to sell and purchase homes, yet
usually undertake very limited searches for an agent. When consumers do search, they cannot
rely on numerical ratings – one to five – by companies such as Zillow, Realtor.com, Yelp, and
Facebook. These ratings are inflated by their dependence on agent solicitation of client
comments and other factors.
The most useful information about quality of service is the extent and nature of agent
experience and detailed client reviews about service received. Unfortunately, agents themselves
usually provide limited, and often highly biased, information about these two factors. A
recommendation from a friend or associate is helpful, yet usually reflects knowledge about only
one agent.
Five companies provide information about a large number of real estate agents on
websites that consumers can access for free without providing personal information – Zillow,
Realtor.com, HomeLight, Facebook, and Yelp. In analyzing information provided by these
websites about agent quality of service, we found that Zillow agent profiles represent by far the
most useful source. Their profiles cover a large majority of active agents and include current
listings, past sales, customer reviews, and other information for most of these agents.
The report suggests ways that consumers can use Zillow information to select an agent.
It also, more broadly, recommends a process that home sellers and buyers can follow, including
key questions for agents, to optimize their selection.
Introduction
A large majority of consumers, around 90 percent, use the services of a real estate agent
to sell or purchase a home. This percentage of usage has grown over time – according to Harris
Insights surveys, from 81 percent in 2001 to 90 percent in 2018.2
Role of Agents is Important: Consumer reliance upon agents is understandable to most
people who have sold or purchased a home. Home sellers and buyers are involved in the sale or
purchase of a property whose value usually exceeds their annual income. Given the high
financial stakes, these consumers look to agents for several critical services:
2 Surveys by Harris Insights & Analytics reported in: Real Trends, 2018 Consumer Study: Relationships Still
Matter Most With Housing Consumers. A 2017 Zillow Group Consumer Housing Trends Report found that 89
percent of sellers decide to list with a real estate agent.
Choosing A Real Estate Agent | CFA 3
Providing overall management of the sales process;
Finding an attractive home or buyer;
Securing a favorable price; and
Ensuring compliance with legal requirements.3
In performing these services well, agents utilize extensive knowledge about the local
housing marketplace to optimize financial value received by clients, then manage a process
involving completion of many disclosures and other forms. Real estate agents who perform
these services effectively are true professionals. As is true for other professionals, some agents
have greater expertise and work harder than other agents. However, it is much easier for real
estate agents, than for professionals such as physicians and attorneys, to secure a license to
practice. In some states, one can complete the required training to qualify for a real estate
license in only a month or two, and at a cost that may be less than $1,000.4
Accordingly, there can be a huge gulf between the quality of service offered by different
agents. A highly motivated agent who works full-time and has facilitated the sale of many
properties can often offer far superior service to that of a new entrant. Yet, unlike most other
professionals, real estate agents in a geographic area usually seek to collect the same commission
for their services regardless of the quality of the service they provide.5
Consumer Search for an Agent is Limited: Given the potential differences in agent
quality of service, it may seem surprising that consumers spend so little time and effort searching
for an agent. This lack of effort was certainly exaggerated by the real estate professional who
said: “Most people spend more time picking a restaurant than they do picking a real estate
agent.”6 Yet, annual surveys of home buyers and sellers by the National Association of Realtors
document a limited consumer search. In a 2018 NAR survey, 75 percent of buyers
“interviewed” only one agent while 75 percent of sellers “contacted” only one agent.7
Understandably, a number of consumers chose an agent with whom they had previously worked.
3 According to the National Association of Realtors’ 2019 Profile of Home Buyers and Sellers (p. 77), what buyers
“want most from real estate agents” is “help finding the right home” (52%), “help buyer negotiate the terms of sale”
(12%), “help with the price negotiations” (11%), and “help with paperwork” (8%). According to the 2017 Zillow
Group Consumer Housing Trends Report, reasons why consumers decide to use an agent include ability to attract
interested buyers (89%), ability to guide sellers through the process of selling (82%), and handling contract
negotiations (82%). 4 In Massachusetts in 2015 according to one source, one could obtain a license in as little as four days at a cost as
small as $250. DonnaVS, “Getting Your Real Estate License is Easier Than You Think,” SVN (August 19, 2015). 5 See Brobeck, Hidden Real Estate Commissions, loc. cit., which cites much research on the subject and includes the
author’s own agent survey of commissions and their negotiability. 6 Quote by Kathy Braddock of William Raveis NYC from the article: Joanne Kaufman, “How to Choose a Real
Estate Broker,” New York Times (December 28, 2018). 7 NAR, 2019 Profile of Home Buyers and Sellers, loc. cit., pp. 81, 126.
Choosing A Real Estate Agent | CFA 4
Yet, 69 percent of first-time buyers interviewed only one agent.8 The brevity of seller search for
an agent was also reported in a recent survey of homeowners. Four out of five sellers (80%)
using a traditional agent hired one of the first two agents with whom they met. And nearly three-
fifths (58%) of these sellers reported that they spent less than three hours researching how to sell
their home.9
The limited search for an agent partly reflects the fact that buyers and sellers are often
more focused on the sale of property and its price than on the services of a real estate agent,
especially if they are simultaneously trying to sell one home and purchase another.10 However,
this limited search also reflects the difficulty consumers have in finding and understanding
information about agent quality of service. One significant finding of this study is that a large
majority of agents and their firms do not provide important information about agent experience,
success, and consumer satisfaction. Another finding is that, while third parties such as Zillow
and Realtor.com include these types of information, the quantity and quality of the information
in these sources varies considerably. This report evaluates these sources, then suggests how
consumers can best use their information to select an agent.
Specifically, in separate sections, this report:
Identifies key indicators of agent quality of service;
Analyzes related information made available by agents and their firms;
Evaluates other sources of information about agent quality of service; and
Summarizes findings, explains how sources can be best used by consumers, and more
broadly, suggests a process for selecting an agent.
How to Assess Agent Quality of Service
How Quality of Service Has Been Measured: Buyers and sellers desire a home to be
purchased or sold in a timely manner at a desirable price. After purchase, buyers do not like
unpleasant surprises, such as major defects that were previously unknown and not identified by
home inspections. These expectations are more likely to be met if agents exhibit certain
qualities. Zillow asks consumers to rate four of these qualities on a five-point scale – local
knowledge, process expertise, responsiveness, and negotiation skills. The qualities that
Realtor.com asks buyers and sellers to rate, also on a five-point scale, are fairly similar – market
expertise, responsiveness, negotiation skills, and professionalism & communication.
8 Ibid, p. 81. 9 Erik J. Martin, “Home sellers do less than 3 hours of research, hire the first agent they meet,” Mortgage Reports
(March 16, 2019). 10 For a discussion of this and related issues see: Comments of Stephen Brobeck Before the Department of Justice-
Federal Trade Commission Workshop on Competition Issues (June 5, 2018).
Choosing A Real Estate Agent | CFA 5
The Most Popular Source of Information About Agent Quality of Service: The most
popular current source of information about agent quality of service is other consumers. In a
Real Trends survey, the highest response (69%) to a question about “what was important when
looking for a real estate agent” was “referrals from people I trust.”11 In an NAR consumer
survey, over half (51%) of first-time home buyers and nearly half (46%) of first-time home
sellers found an agent through a referral by a friend, neighbor, or relative.12
These referrals can be useful, especially if they are based on a trusted person’s recent
experience with an agent that helped them buy or sell a home. However, the value of this
recommendation is limited because that person usually has little knowledge about other agents.
Consequently, most people who have had a good experience with one agent do not know
whether they would have had a much better experience with another agent. An effective
consumer search for an agent entails comparing the services offered by a number of agents. In
this search, it is important to consult all key information sources about those agents.
Consumer-Based Ratings of Agents: Both Zillow and Realtor.com, as well as agencies
such as Yelp and Facebook that provide customer ratings for a broad array of services, rate many
agents on a scale from one to five with five as the top rating. The limitation of most of these
numerical ratings is that they are strongly biased upward in favor of the service providers. As an
NBC Money article noted: “But now, from Amazon to Yelp to Uber, five-star reviews are
practically the norm.”13
As the table below shows, real estate agents are no exception -- a large majority receive
ratings of 5.0. In a sample of 600 active real estate agents from 30 cities, Zillow provided ratings
for 349 of the agents (58%).14 Eighty percent of these agents were rated 5.0, 92 percent were
rated at least 4.8, and no agent was rated below 4.3. A large majority of the agent ratings of
three other rating agencies were also 5.0. An analysis of the ratings of 150 agents (from the
sample of 600) revealed, first, that each service company rated only a minority of agents –
Realtor.com, 19 percent; Facebook, 39 percent; and Yelp, 25 percent – and second, that most of
the ratings were 5.0 – Realtor.com, 76 percent; Facebook, 73 percent; and Yelp, 70 percent. As
with Zillow’s ratings, nearly all of the remaining ratings for these three services were at least 4.0.
Four Yelp ratings, though, were below this level.15
11 Real Trends, 2018 Consumer Study, loc. cit. 12 NAR, 2019 Profile of Home Buyers and Sellers, loc. cit., pp. 79, 125. 13 Stephanie Thurrott, “Online reviews: Here’s what’s behind all those 5 star ratings,” NBC Money (May 7, 2018). 14 The 600 agents were drawn from the first 20 residential real estate companies listed by Google in each of the 30
major cities. All agents had at least one current listing or recent sales, usually both. A large majority were brokers
or associate brokers who had practiced for at least five years. The sample of 150 agents included the first five
agents selected in each of the 30 cities. 15 Because of broad public awareness and its independence, Yelp would seem the most likely of the four websites to
receive unsolicited critical reviews and poor ratings from disgruntled consumers.
Choosing A Real Estate Agent | CFA 6
Table 1: Information Sources With Agent Ratings
Website % With Rating
% Rated 5.0
Zillow (n=600) 58% 80%
Realtor.com (n=150) 19% 76%
Yelp (n=150) 25% 70%
Facebook (n=150) 39% 73%
These high ratings reflect, to an extent, a high level of buyer and seller satisfaction with
the services received by one’s real estate agent. However, surveys of home buyers and sellers do
not reveal universal satisfaction. In NAR’s 2019 survey, 27 percent of buyers and 34 percent of
sellers were not certain that they would use the same agent again or recommend them to others.16
Furthermore, 25 percent of buyers and 52 percent of sellers indicated that they were less than
fully satisfied with the selling process.17 It seems unlikely that nearly all of those who did not
rate their agent or the selling process highly would give their agent a 4.8 rating or above, as did
92 percent of those providing Zillow reviews in our sample. Why then are the large majority of
ratings at 5.0 or just below this level?
In addition to consumer satisfaction, the high ratings reflect the fact that most of the
reviews on which the ratings are based, were solicited by the agents themselves from among
clients whom they believed were satisfied with their service. Rating companies including Zillow
and Realtor.com facilitate the solicitation and gathering of these reviews (though do not remove
responsible negative reviews).18 Third party companies exist who market their ability to carry
out the solicitation.19
In addition, the high ratings may reflect an effort by the rating companies to encourage
agents to provide information or advertise with them. An agent receiving a rating below 5.0 is
less likely to cooperate with the company let alone pay for advertising. Evidence of this rating
company concern is the many agents who receive a 5.0 rating based on very few, sometimes only
one, customer comment. For most of the rating companies in the sample of 150 representative
agents, a significant minority with a 5.0 rating had three or fewer customer reviews – 39 percent
for Facebook, 46 percent for Yelp, and 36 percent for Realtor.com. Eleven percent of the Zillow
agents with a 5.0 rating had three or fewer customer reviews.
16 NAR, 2019 Profile of Home Buyers and sellers, loc. cit., pp. 85, 131. Most of these buyers and sellers said they
would probably use the same agent. 17 Ibid, pp. 69, 122. 18 See: Teke Wiggin, “Online agent ratings may be inflated, but they’re still valuable,” Inman News (August 6,
2015). “The Truth about Online Reviews of Real Estate Agents,” Metro Atlanta Home Group (March 24, 2016). 19 See AppSally online promotion of Zillow reviews, secured from legitimate customers but only delivered if they
have 4 or 5 star ratings.
Choosing A Real Estate Agent | CFA 7
Regardless, the insubstantial basis of many 5.0 ratings, together with the high frequency
of 5.0 ratings, suggest that these ratings should not be taken seriously by consumers, with one
exception. Ratings below 5.0, especially those below 4.8 at Zillow, may help identify real estate
agents who provide poor quality of service. Consumers should think twice before requesting the
services of the one agent in our sample who received a 1.0 Yelp rating. Yet, the ratings are
limited in that they provide little help to buyers and sellers who wish to distinguish between
agents who offer quality of service that is excellent, good, or only fair.
The Most Useful Information About Agent Quality of Service: There are many things
that buyers and sellers might find useful in knowing about a real estate agent, including:
their years working in the industry and as an agent;
whether they have done this work in the neighborhood, city, or region where they are
now practicing;
whether they are a broker, associate broker, or agent;
whether they are a realtor, bound by the industry’s code of ethics and with access to
the local Multiple Listing Service;
courses, seminars, and other post-certification education;
any awards for service; and
their community service apart from practicing as an agent.
However, the most useful information about quality of service is the extent and nature of
their agent experience and detailed consumer reviews of that quality of service. The most useful
and obtainable information about agent experience is the record of their past sales, specifically:
representation of seller, buyer, or both;
the distribution of sales over time especially recently;
their locations;
days on the Multiple Listing Service;
sale prices; and
any delistings, markdowns, or markups.
This information can increase buyer and seller understanding about the activity and
success of the agent, including their relationship to agent role and types of housing (location and
price). The data, however, also have their limitations.
Sale price and timing can be influenced by factors beyond the competence and efforts
of agents.
At firms where teams of realtors facilitate sales, regardless of the importance of their
role in a sale, more than one participating agent often list the sale. Realtors working
solo in small firms are less likely to receive assistance from other realtors so deserve
more credit for a successful sale.
Choosing A Real Estate Agent | CFA 8
Information on agents serving as transaction brokers or dual agents is not always
accurate. Comparison of this information provided by Zillow and HomeLight for
several agents in two cities revealed discrepancies. When one company reported an
agent working with both buyer and seller on a sale, there was often disagreement as to
whether the agent represented one party or worked with both.20 In part, these
discrepancies may reflect the fact that county records do not provide information
about representation; rather that this information comes from agents or their firms.
The other information about agent quality of service, that can be useful, is detailed
customer reviews of this service. Key factors are:
Number of reviews especially recent ones:
Length, detail, and individuality of the reviews:
Whether the agent is mentioned by name; and
Any problems or a lukewarm endorsement.
As noted earlier, most buyer and seller reviews are solicited by agents, often with the
help of a third party like Zillow or Realtor.com. This solicitation minimizes the number of
negative reviews. Moreover, if the reviews are short, cursory, and general, they may be “fake” –
generated by someone other than the client – or biased by clients who wrote them in order to
obtain some incentive.21 Nevertheless, given efforts to screen out fake reviews, it appears that a
large number of detailed reviews by third parties were written by customers who report on their
own experience with an agent.22 Consumers looking at reviews of an agent should particularly
note whether the reviews mention the agent by name. For some agents, the listing of reviews
includes those for all agents in the firm. When the agent is the senior and managing broker,
these reviews can be informative. Yet, when the agent is only a sales representative, the reviews
reveal more about the firm than the agent.
20 For example, over a recent period of several months, HomeLight listed four sales where one Orlando agent
worked with both seller and buyer, yet on these sales Zillow listed the same agent as working with either the seller
or buyer but not both. Similarly, HomeLight listed eight sales where a Denver agent worked with both seller and
buyer, yet on five of these sales Zillow associated this agent with either the seller or the buyer but not both. 21 Joe Enoch, “Can you trust online reviews? Here’s how to find the fakes,” NBC Money (February 27, 2019). 22 For example, Zillow examines every customer review before publishing using criteria mentioned later in this
report, and Yelp now uses automatic detection systems and manual moderation teams to screen reviews, then lists
questionable reviews as “not recommended.” Law enforcement has also engaged. By 2018, the New York State
Attorney General had fined 25 companies for flooding the internet with fake reviews. Pei-Sze Cheng, Kistrina
Pavlovic, “I-team: Scrutinizing Fake Business Reviews Online,” NBC News New Jersey (August 1, 2018). Yet, a
2019 British report suggests that Facebook has failed to block the sale of fake reviews through its website. Rebecca
Smithers, “Facebook still flooded by fake reviews, says Which?” The Guardian (August 5, 2019).
Choosing A Real Estate Agent | CFA 9
Disciplinary Actions: State real estate regulators provide an opportunity for consumers
(and agents) to file complaints against agents. Regulators then investigate these grievances and
sometimes take disciplinary action against agents. In a review of several state websites, we
could find evidence of relatively few consumer complaints and disciplinary actions. This paucity
may reflect several factors:
relatively few consumer complaints because of little consumer dissatisfaction and/or
lack of consumer awareness about where to complaint;
states not reporting these disciplinary actions on their websites; and
reported actions being difficult to find, and some of these reports not indicating the
cause of the action.
In the future, CFA will undertake a thorough study of how state real estate regulators
handle and report on consumer complaints.
Information Made Available by Agents and Their Firms
Real estate agent and firm websites represent an important source of information for
consumers, especially for home buyers. According to a recent National Association of Realtors’
survey, 93 percent of home buyers used an online website in their home search.23 The
percentage of young buyers who said they undertook an internet search was even higher.
According to the NAR survey, 62 percent of buyers under 29 years of age found their home on
the internet.
All well-established real estate firms, and many individual agents, have a website.
Nearly all of these sites list homes for sale. Most websites of firms – 78 percent according to the
NAR survey – also include agent and staff profiles. How useful is the information in these
profiles? Using the 30-city sample of 600 active agents described earlier, we examined the
information provided by their websites or web pages about their past sales and customer reviews
of these sales.
Sales Experience: Only 30 percent of the websites included information on the past
sales of the 600 agents. This percentage is inflated to some extent by the fact that, for some
agents, sales information was for the entire firm or team. That was most obvious when the
number of sales was very large, sometimes exceeding 1,000. In these instances, when the agent
was also the head of the firm or team, it is appropriate to give them some credit for all sales.
23 National Association of Realtors, Real Estate in a Digital Age 2019 Report (August 22, 2019). The 2018
Consumer Study by Home Trends (loc. cit.) puts this number at 92 percent.
Choosing A Real Estate Agent | CFA 10
As the table below shows, the information about sales was usually limited to the sale
price and the address of the property. Four percent of the websites listed a city but not a street
address. For a few agents, the website provided information about sale price for some properties
sold but not for others
Table 2: Percentage of Agent Websites With Information About Past Sales and Types of Information (n=600)
Any specific information 30%
Property address 26%
Sale price 28%
Date of sale 7%
Representation of buyer or seller 10%
As the table also reveals, very few websites listed the date of sale and whether the agent
worked with the buyer, seller, or both. Including the date of sale is particularly important in
helping consumers understand the experience of agents. Without these dates, buyers and sellers
learn little about how active the agent has been – especially whether they have recently and
successfully facilitated the sale of properties.
Customer Reviews: Nearly half (49%) of the 600 websites included at least one
customer review. Many of these websites included more than ten reviews. A number linked to
reviews by Zillow or other third party information sources. Yet, as the table below indicates,
some websites included very few reviews: thirteen percent – 27 percent of websites with
reviews – contained three or fewer reviews.
Table 3: Percentage of Agent Websites With At Least One Customer Review (n=600)
Any number 49%
One review 7%
Two reviews 3%
Three reviews 2%
1-3 reviews 13%*
*Reflects rounding to nearest one percent.
Choosing A Real Estate Agent | CFA 11
How reliable are the customer reviews on agent websites as accurate sources of
information about agent quality of service? First, one can expect that there would be no negative
reviews, and we saw none. Second, when there are few reviews, it is likely that either the most
favorable have been included or the agent, for whatever reason, obtained few reviews. Third,
since there are no external controls, it is possible for agents to create reviews or ask their friends
or fellow agents to do so. Nevertheless, when there are a large number of lengthy reviews,
consumers may learn useful things about how the agent interacted with clients. Furthermore, the
fact that an agent made an effort to collect the reviews suggests that the agent is serious about
their work.
Information Made Available by Other Websites
A number of websites, some local, offer to identify “best agents.” They request
information about the service desired and related conditions, ask for your email address and
phone number, then provide you with a short list of recommended agents who often try to
contact you.24 Typically, the companies are compensated if an agent is contacted and the agent
facilitates a sale.
Only five companies provide information about a large number of real estate agents on
websites that consumers can access for free without providing personal information – Zillow,
Realtor.com, HomeLight, Facebook, and Yelp.25 Zillow, Realtor.com, and HomeLight websites
provide information about current listings, past sales, and customer reviews. Facebook and Yelp
websites include only customer reviews.26
Which of these websites supply the most useful information? Which of them should
consumers spend the time to consult? Our analysis of these websites includes not only the extent
and type of information they make available, but also the proportion of active agents with a
listing in this source. Obviously, a website with information on most active agents is, other
factors being equal, far more useful than a website with information on only a minority of agents.
For the sample of 150 representative active agents, we examined whether the five websites make
available information on past sales and whether the websites include customer reviews. These
agents were the first five of the 20 agents in each of 30 cities that were part of the larger sample
described earlier. All had current listings or past sales.
24 This model is also used by other types of information service providers. See Stephen Brobeck and Jack Gillis,
Angie’s List: An Evaluation of Its Usefulness for Consumers, Consumer Federation of America report (April 2019). 25 More than a decade ago, Angie’s List provided customer reviews of some agents. These reviews are no longer a
priority on their website. For the Washington DC area, the website includes no agent reviews. In our sample of
150, only several agents had Angie’s List customer reviews. 26 HomeLight also offers “best agent” recommendations for which, if there is a sale, they are paid a referral fee.
Choosing A Real Estate Agent | CFA 12
Past Sales: As the table below shows, the Zillow website included information on past
sales for a large majority of the 150 agents; the Realtor.com site included sales information for
slightly more than half of the agents; and HomeLight supplied this information for only one-third
of the agents.
Table 4: Percentage of Information Sources Listing Past Sales of Agents (n=150)
Zillow 77%
Realtor.com 55%
HomeLight 33%
All three sources nearly always supplied basic information for each property sold -- its
address, sale price, side represented by the agent (buyer or seller), and date of sale.
Zillow most frequently listed the largest number of sales per agent. When compared to
Realtor.com, Zillow listed the largest number of sales 83 percent of the time. When compared to
HomeLight, Zillow listed the largest number of sales 56 percent of the time. Accordingly,
considering both the percentage of agents listing past sales and the number of sales listed per
agent, Zillow listed a far larger number of home sales than did either Realtor.com or HomeLight.
Only Zillow and Realtor.com provided information about price history – initial list price,
any delists, any markdowns and markups, and final sale price with associated dates. Sellers can
use this information to learn how long it takes for listing agents to sell a property and whether the
final sale price is higher or lower than the most recent list price. Buyers can use the information
to learn whether their agents are associated with a final sale price that is higher or lower than the
initial list price. In part because Realtor.com does not consistently identify whether the agent
worked with the buyer or seller, its information about price history is generally less useful than
that of Zillow.
Consumers should be cautious about interpreting this information because price histories
are influenced not just by agents but also by strong seller and buyer preferences and by markets
that favor sellers or buyers. Yet, by looking carefully for patterns related to an agent’s temporal
and price history in both selling and buying properties in recent years, one can gain useful
information about that agent. Neither Zillow nor Realtor.com can provide information about
agents who fail to sell or purchase properties.
Customer Reviews: As the table below shows, only Zillow included customer reviews
for most of the 150 agents. The other four sources each provided reviews for well under half of
the agents.
Choosing A Real Estate Agent | CFA 13
Table 5: Percentage of Information Sources With Customer Reviews of Agents (n=150)
Zillow 61%
Realtor.com 25%
Facebook 38%
Yelp 26%
HomeLight 12%
In addition, as the table below indicates, Zillow tended to provide the largest number of
reviews per agent with at least one review. They were less likely to include only one review and
much more likely to provide at least ten reviews.
Table 6: Percentage of Reviews by Information Source for Agents With Reviews
Only 1 Review
10 or More
Reviews
Zillow (n=92) 13% 55%
Realtor.com (n=38) 24% 34%
Facebook (n=57) 16% 33%
Yelp (n=39) 28% 26%
HomeLight (n=18) 44% 11%
Comparing Agent Websites and Zillow as Information Sources
Zillow includes far more useful information about real estate agents than do other third
party sources, specifically:
Most agents with past sales listed;
For these agents, more sales listed per agent and more information about these sales;
Most agents with customer reviews; and
For these agents, more reviews per agent.
Agent websites are also important information sources, not only because they often
contain a broad array of information about the professional and life experience of agents, but also
Choosing A Real Estate Agent | CFA 14
because they are the website that consumers seeking information about an individual agent are
most likely to search. Accordingly, it is useful to compare the information provided by agents,
in terms of quantity and quality, with that made available by Zillow.
Quantity of Information: We compared the website listings of past sales and customer
reviews using the sample of 600 representative agents (from 30 different cities). All 600 agents
had their own website listing. Eighty-eight percent of the agents also had a Zillow listing. The
percentages given below are based on all 600 agents whether or not they had a Zillow listing.
As Table 7 reveals, Zillow listed past sales for 77 percent of the 600 agents. Only 30
percent of agent websites included this information. Six percent of agent websites (36) had sales
listings when Zillow did not.
The Zillow listings contained far more information about each sale. Nearly all of the
Zillow listings included date, address, price, and representation of buyer or seller. On the agent
websites, seven percent (23 percent of those with sales) included the date of sale while ten
percent (33 percent of those with sales) indicated whether the agent represented buyer or seller.
As noted earlier, inclusion of the date is especially important because it reveals whether the agent
has recently helped sell properties and, if so, to what extent.
As Table 7 also indicates, Zillow included customer reviews for 61 percent of the 600
agents. Nearly half (49%) of agent websites included at least one customer review. In addition,
the Zillow agent listings tended to include a larger number of reviews than did the agent
websites. Nearly one-third of the Zillow listings (32%), but only one-fifth (21%) of the agent
websites (43% of those with reviews), included a least ten customer reviews.
Table 7: Comparison of Information in Zillow Agent Listings and in Agent Websites (n=600)
Zillow Agent
Websites
Include past sales 77% 30%
Include date of sale 77%* 7%
Include representation 77%* 10%
Include customer reviews 61% 49%
At least 10 customer reviews 32% 21%
*A few agent pages on Zillow included some sales without this information.
Choosing A Real Estate Agent | CFA 15
One other important piece of information is the date of the review because it reveals how
active and successful agents have been recently. All Zillow customer reviews include a date.
Only 23 percent of agent websites with reviews include dates of these reviews. Nearly one-third
(30%) of the agent websites with dates linked to the agent’s Zillow reviews while one other
agent website linked to the agent’s Facebook reviews.
Quality of Information: The quality of agent reviews on the Zillow website is superior
to the reviews on agent websites. On their own websites, agents have the option of including
only the most positive customer comments. Furthermore, if they, their friends, or their
colleagues create fake reviews with no verifiable information about the sale – such as date or
client name – these “reviews” are not monitored by a third party and are difficult for consumers
to spot.
While almost all Zillow reviews are generated by agents who either contact their past
clients or hire third parties to make this contact, these reviews are sent directly to Zillow, where
it is difficult for agents to remove critical comments.27 Reviewers must first register with Zillow,
providing personal information about themselves that can be checked. After registering, they
must provide information about the sale of their property that also can be checked. Zillow also
“reserves the right to withhold submissions where suspicious activity or potential conflicts of
interest could be present.” These activities and conflicts include:
Reviews from family members or work colleagues;
Invalid email addresses, including use of “disposable” addresses;
An unusually high number of submissions by one user;
An unusually high number of reviews for an agent; or
Reviews from users who have been offered compensation for writing the review.28
Comparing the agent website and Zillow reviews of one well-established Seattle agent
shows how stark the differences can be. Zillow included nearly 100 reviews for this agent which
all differed, were not short, and contained some criticism. By comparison, the agent website
included only 39 customer reviews which were much shorter, included no criticism, and
typically read like ad promos. For example, the first words in these reviews, often their own
Because of Zillow’s third party status with weaker conflicts of interest, its client reviews
are a more reliable source of information than those on agent websites. Still, Zillow’s
dependence on agent selection of past clients makes their reviews more biased than those
published by organizations, such as Checkbook Magazine, that generate reviews from their own
subscribers. Even agent reviews on popular rating services such as Yelp are mainly generated by
agents who communicate with past clients or pay third party services to do so.
Nevertheless, it is useful for consumers to read Zillow reviews before selecting an agent,
in part because few agent reviews from completely independent sources exist. Zillow reviews of
an agent are particularly useful if they are numerous, detailed, and dispassionate. These reviews
can provide helpful information about how an agent and their firm works with clients. Any
critical comments should be seen as red flags, especially if they are made by more than one
reviewer. Conversely, an absence of reviews should be of concern. Either the agent was
relatively inactive, decided to generate reviews but not place them on Zillow, or was not
confident that reviews would be sufficiently favorable. Zillow will not accept customer reviews
unless the agent has created a “profile” on the Zillow website.
Zillow obtains information about past sales from agents and from third-party data
providers who search county records. Information submitted by the agent is matched with
information from the county records.
Summary and Recommendations For Choosing An Agent
Our evaluation of information sources about agent quality of service has found that
Zillow agent profiles represent the most useful source. Their profiles cover a large majority of
active agents – Zillow claims 1.6 million -- and include current listings, past sales, customer
reviews, and other information for most of these agents. Other third party information sources
such Realtor.com, Facebook, Yelp, and HomeLight include far less information about far fewer
agents. While nearly all agents have their own website or website page, the information in these
sources is usually far less complete and more biased than that provided by Zillow agent profiles.
Before searching for information about individual agents, consumers should learn more
about their housing marketplace.
Sellers should consult estimates from sources such as Zillow and Redfin for a
ballpark estimate of their home value.29 Sellers should also search for homes similar
29 These types of estimates have been controversial. See: Emily Landes, “How much should you trust a Zillow,
Redfin estimate when it comes to home values?” SF Gate (January 31, 2020). Also: Kenneth Harney, “Mortgage
Broker Unveils Another Online Way to Assess What Your House is Worth,” Washington Post (June 28, 2017).
Choosing A Real Estate Agent | CFA 17
to theirs to learn about their prices, time spent on the market, and any markdowns or
markups.
Buyers should determine as precisely as possible what they want, need, and can
afford in a new home (and qualify for a mortgage), then search Zillow and other
websites for properties with these characteristics.
With this information in hand, prospective home buyers and sellers are ready to search
for an agent. How should they do so utilizing the Zillow information on individual agents, which
can be accessed on the Zillow website under “agent profiles” found in the navigation bar at the
top of the home page? Taking into consideration recommendations from friends and associates
who have recently sold or purchased a home, consumers can use the website to identify several
agents to be interviewed. In looking at agent profiles, they should:
Pay particular attention to recent agent activity as indicated by past sales and current
listings. A very large number of either may indicate that the listings are by the firm,
not the individual agent, though keep in mind that team leaders often list all sales and
current listings of their team members.
Use information from past sales to learn whether an agent typically represented one
side in a home sale, the price range of these sales, and the geographical area in which
the agent has worked.
Consult the price history of properties listed by agents to learn how long it took them
to sell properties and whether, during this interval, their price was marked down or
marked up. These price histories will also reveal whether buyer agents were
associated with price markdowns or price markups.
Look for a large number of detailed reviews that mention the agent by name and
describe and assess the specific experiences of clients with the agent. Keep in mind
that some agents, especially team leaders, include all of the reviews for their firm or
team. Be wary of reviews full of enthusiasm and generalities about the agent. Look
instead for positive but objective, detailed reviews of the client’s experience with an
agent from first contact through the sale and any aftermath.
Consumers are now prepared to select and interview several agents.30 Priority should be
given to those who work full-time as agents and have extensive recent experience representing
sellers or buyers (depending on the consumer’s need) of similarly priced properties in preferred
neighborhoods. Buyers should pay particular attention to how the agent’s firm displays
properties on its website. Both buyers and sellers should think twice before employing relatives
30 A useful discussion of selecting an agent is found in: Kaufman, “How to Choose a Real Estate Broker,” loc. cit.
Also helpful is: Ann Brenoff, “What You Really Need to Know Before You Pick a Real Estate Agent,” HuffPost
Money (January 24, 2018).
Choosing A Real Estate Agent | CFA 18
or friends as agents. Statistically, it is unlikely that these agents, often part-timers, will provide
the best service. Personally, it may be difficult to press these agents on an important issue.
In the interviews, all agents should be asked questions about:
Representation: We believe that it is important for both buyers and sellers to have
someone, a real estate broker or attorney, representing their fiduciary interests in the
sale. Sellers should ask whether the agent will always represent these interests, even
if they locate a buyer. If buyers decide to work directly with a listing agent, they
should employ an attorney.31
Delegation: Will the agent work with the consumer or delegate much work, including
showing properties and responding to client calls or emails, to other team members?
This delegation is more likely if the agent has many clients and is part of a team with
differentiated roles.
Length of Contract: This is a complex issue that includes whether a consumer sells or
buys, whether the market is favorable to sellers or buyers, the degree of confidence
you in an agent, and preferences of individual agents. However, we strongly caution
against signing an exclusive agreement for more than six months.32
Sellers should also ask questions about:
Recommended sale price: If this suggested price is much higher than those of similar
properties, some seller skepticism is warranted.
Recommended property improvements: Look for candor here. To be presentable,
most properties will need work, if only cleaning, tidying, and decluttering but
sometimes more substantial improvements.
Recommended marketing: Most importantly, ask whether the property will
immediately be placed on the local Multiple Listing Service (MLS). Agents have a
financial incentive to delay this listing and search for a buyer among their clients or
clients of their firm, raising conflict of interest issues.33
Commission: Despite the uniformity of real estate commissions, sellers may be able
to negotiate a lower rate, especially if the sale price is high, they are selling and
buying different properties with the same agent, or their agent also recruits and works
with the buyer. It is important, however, that the rate reduction come from the listing
31 See discussion in: Brobeck, Agency Mess, loc. cit., pp. 7-8. 32 An informative article for sellers on this issue is: Ruby Launder, “How Long Are Real Estate Listing
Agreements,” Local Agent Finder (June 9, 2015). A helpful discussion for buyers is: Ilyce Glink and Samuel J.
Tamkin, “Is It Necessary for Home Buyers to Sign a Contract With an Agent?” Washington Post (August 5, 2019). 33 To avoid a procession of potential buyers visiting their home, some sellers prefer that their agent find a buyer
privately. If so, chances are that the final sale price will be lower than if the property had been exposed to many
potential buyers on the local Multiple Listing Service.
Choosing A Real Estate Agent | CFA 19
agent’s split, not that of buyer agents who then may have less of an incentive to show
your property.34 Discounters like Redfin typically reduce their own commission but
keep the buy-side commission at three percent.
After describing to an agent the kind of property desired, buyers should ask the agent to
recommend specific properties, then check to see whether all of these properties have been listed
by the agent or the agent’s firm. If so, the recommendations of the agent may be biased by their
obligations to existing clients and by their desire to retain the entire commission for themselves
or their firm. Exclusive buyer brokers will not face this potential conflict of interest.
34 See Brobeck, Hidden Real Estate Commissions, loc. cit.
Choosing A Real Estate Agent | CFA 20
APPENDIX A: AGENT WEBSITE INFORMATION BY CITIES
SAMPLED, EAST TO WEST (20 agents/city)*
City % With Sales
% With Reviews
Portland, ME 5% 55%
Boston, MA 50% 35%
Westchester Co., NY 45% 60%
Philadelphia, PA 10% 20%
Baltimore, MD 40% 40%
Charlotte, NC 25% 60%
Orlando, FL 10% 40%
Cleveland, OH 40% 30%
Columbus, OH 30% 45%
Atlanta, GA 10% 35%
Nashville, TN 20% 55%
Indianapolis, IN 25% 45%
Chicago, IL 40% 70%
Milwaukee, WI 35% 60%
Memphis, TN 25% 30%
New Orleans, LA 15% 35%
St. Louis, MO 25% 75%
Minneapolis, MN 25% 65%
Kansas City KS 15% 35%
Houston, TX 15% 55%
Dallas, TX 40% 70%
Oklahoma City, OK 40% 35%
Denver, CO 25% 60%
Salt Lake City, UT 0% 40%
Phoenix, AZ 25% 50%
Las Vegas, NV 30% 50%
San Diego, CA 50% 60%
San Francisco, CA 70% 65%
Portland, OR 30% 50%
Seattle, WA 50% 70%
Average 30% 49%
*Small agent subsamples do not allow valid comparisons between individual cities but do suggest much variation overall.
